Considering the application modernization strategies you've observed, what core principles do you believe are crucial for success and what are areas where companies have more flexibility in their approach?

Probably the most crucial point is to do a really good job of determining what the internal resource commitments are going to need to be and to figure out how to staff those (for people that probably have demanding day jobs already).

Important also to help those that might feel threatened about losing their jobs to understand that they expertise they have developed will be useful in new and likely higher-level, higher-value ways.

Also, can the project be taken in smaller "bites", rather than a few, or one, large switch over.

You can have more flexibility in your approach to the extent that the timeline is of your own choosing, than if it is driven by other factors not under your control.

Our application modernization strategies are articulated around replacing in-house apps with out of the shelf solutions.  With more than 350 applications for banking retail and payments, we found out that maintaining them was a huge burden.

But switching to SaaS or anyking of commercial solutions requires a core principle that is crucial: we must standardized our products and processes.   It's the ADOPT versus ADAPT principle.  We don't want to customize what we're gonna buy.

I believe that companies being more flexible in adopting market best practices are more keen to have a greater success. 

And, at this moment, we're not part of these companies ;-)

Sociotechnical as the core principle. Application modernization is not only just about technology modernization, but also modernizing the people and collaboration aspects.

- Commitment to adopt by the business. Solutions which are pushed to the business are usually much less successful. 
- Clear and tangible success KBIs. Calculation method, baseline and targets defined from the start
- Be ready to fail fast
- Be ready to change fast. What is modern today will not be modern tomorrow.
- Companies have more flexibility in the areas of internal productivity. Much less in the areas of customer experience. And zero in the areas of compliance.

Regarding modernization, that is a broader term, I would focus on platform engineering (cloud & DevSecOps) and the way of working (agile approach and clear borders about teams responsabilities). I also would focus on architecture discipline, that coverd not only business and technology but also team organization and boundaries.
Hope this may help.

Regards